Recent research by the Council of Economic Advisers (1997) and Ziliak, Figlio, Davis, and Connolly (1997) provides substantively different estimates of the impact of the macroeconomy and welfare reform in accounting for the recent decline in AFDC caseloads. In this paper we conduct an extensive...

A fundamental property of a progressive income tax is that it provides implicit insurance against shocks to income by dampening the variability of disposable income and consumption. The Economic Recovery Act of 1981 (ERTA) and the Tax Reform Act of 1986 (TRA86) greatly reduced the number of...

In order to receive many forms of government assistance, a household?s assets must be below the federal or state mandated limits. Recent theoretical work has shown that such means-tested welfare programs can explain the low levels of saving observed in the data for households with relatively low...